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Malaysia considers seeking cancellation of Formula 1 contract.

Publication: 
Bryan Edwards
chiefofficersnet

It was announced this week, with no notice of public consultation, that the Government of Malaysia was to consider requesting other parties to the agreement to hold a Formula One race to allow it to terminate its contract two years early. It is rumoured that it is, in any event, unlikely to renew its contract on expiry in 2018. youth and sports minister KHAIRY Jamaluddin said, on Wednesday, that a decision would be made on Thursday but, as of Friday evening, no public announcement had been made.

Khairy is right to say that the costs of hosting F1 are high and that the return on investment is limited. He is also right that ticket sales have been declining. He said, too, that TV audiences for the 2016 race were the lowest ever.

The question is how did one of F1's flagship races come to this and can the position be reversed?

A little history: when Malaysia was added to the calendar, it was when the government, under Former Prime Minister Mahathir, was building "mega projects" to raise Malaysia's profile worldwide. The circuit became the only track in the world to include the "F1" designation in its title, a designation which it no longer holds and is simply known as "Sepang International Circuit" or "SIC." The track, designed by Herman Tilke, was, and is, outstanding. But some of the construction of facilities was, like so many roads and bridges built around the same time, poor. Within five years, it was starting to look shabby.

Mahathir is close to persona non grata with the current government after his outspoken comments relating to 1MDB, a financial scandal. His son Tan Sri Mokhzani Mahathir was Chairman of SIC until 17 October 2017. The 2016 race was held on 2 October, two weeks after the Singapore event. There is little doubt that there are political forces at work and former PM Mahathir and Khairy have, in recent months, often clashed in public. It is perhaps significant that Khairy has announced his plan within two weeks of Mahathir's resignation as chairman of SIC.

When the event was launched, grand prix weekends were all about the racing: people went to the circuit, watched a race and went home. There would be a bit of a party after the race where drivers would make up an impromptu rock band but otherwise entertainment was a very secondary part of the event. Soon after the Malaysian event was created, that changed and big name rock concerts became a part of the experience.

Malaysia's history of post-race concerts has been unfortunate. In 2015, Lenny Kravitz cancelled his entire Asian tour which included playing for F1 fans. To their credit, the organisers quickly added K-Pop band, Girls' Generation. In 2014, although the race went ahead, all related concerts, both at the circuit and in the city centre, were cancelled as a mark of respect for those lost in flight MH370. The headline was Christina Aguilera. In 2013, the organisers tried to bounce back from the disaster they had in 2012: due to a complex system of obtaining permissions and permits for foreign artists, with only days to go, headliner Kylie Minogue said that the last deadline for confirmation had passed and cancelled her appearance. It is by no means the only time that major artists have said that they have been left, unconfirmed, with only a short time to go and have withdrawn. Some face was saved when, after teams and tourists had already arrived, Lewis Hamilton's then girlfriend, Nicole Scherzinger, agreed to put on a last minute show in KLCC park.

The 2013 rescue package was in fact a good lineup: Backstreet Boys, Demi Lavato and a range of local, Asian and international musicians and world-class DJs.

However, the KL race suffers from on significant disadvantage compared to Singapore, which is sucking the financial life out of F1 in the region and, yet, the reason that Singapore is a more successful weekend event is also the reason that it's a far worse event for racing fans.

The brutal truth is that the entertainment, restaurants and hotels in KL are 45km from the track and travel is difficult without a private car. A taxi, if you can get one to take you to the track and if you can find one to take you back into town afterwards, will cost, over a weekend, the equivalent of USD150. While KL race tickets are the cheapest in the world (Australians say that flying to KL in a budget airline and staying in a modest hotel is still cheaper than going to the Melbourne race), that's a large amount of pocket money. In Singapore, you get the tube to the track, or even walk from the many hotels within a few hundred metres of the gates.

Sepang posts notices that attendees are not able to take in food and drinks: even Singapore, which finds new ways to tap tourists for money each year, such as an official surcharge on taxi fares and in city car parks during race weekend, allows fans to take in a bottle of water, although they do check all bags on entry. But in Singapore, there is no reason to eat in the circuit. There is a small food area, recognising that only a small number of fans will use it. However, it is made up of proper restaurants and bars, albeit temporary. There are also snacks and water/beer booths around the circuit. And within two or three minutes walk of the gates, there are many excellent cafés, restaurants and bars at prices that are reasonable in Singapore (but would be extortionate in Kuala Lumpur where prices, given exchange rates, are far, far lower).

Malaysia's in-circuit food, outside the catered zones, is, at best, dismal and, mostly, edible only because there is no choice. Despite the heat, it's hard to find a beer although there are stalls selling high-calorie soft drinks everywhere. The circuit is far from anywhere and there are no cafés, restaurants and bars that fans can walk to near the circuit. For foreign visitors, making it so hard to get a beer on a hot afternoon is limiting their enjoyment of the event. I have been to events at SIC where officials lied as to the location of places selling beer, sending me from one place to another, until I found one person that admitted that no alcohol was available outside the invitation-only suites above the pits. We are not, here, talking about fans who become rowdy: they'll find ways to do that whatever restrictions are in place. F1 fans, especially those that travel, tend to be middle-aged professionals not soccer-style louts.

This year, the main headline concert was held in the Sepang circuit, straight after the race which, for many reasons, was an excellent idea. But it left fans with a late night transport headache, a long, very hot, day with poor and expensive food and limited drinks options. The concert, featuring Usher, was announced in July: four months before the race. But fans remain sceptical whether any F1 concert is fixed or whether the announcement has been made on heads of agreement before a final contract has been signed and all necessary approvals and permits irrevocably granted.

Sepang also, this year, made a tremendous effort to re-create its most family-friendly environment: some years ago, the A1GP series was the best event on SIC's calendar. It turned the central concourse into something like a village fête. It was fantastic.

Additionally, the circuit re-profiled two corners: three (to level out the steep but very short dip which, in a tight corner, made acceleration up the back straight more difficult than it needed to be) and 15, the final corner. This change is stunning: now the fast one-and-a-half apex hairpin corner is adverse camber. The radius profile is different to anything else on the calendar but the effect is similar to Canada's "Wall of Champions" without the wall. Better still, there are several valid lines through the corner opening it up for last gasp attacks before the finish line which is close to the exit from the corner. SIC already had some of F1's greatest corners and now it has another one.

Also, weak construction meant that almost immediately after the circuit was opened, the racing line on entry to Turn 1 had become heavily corrugated. Those bumps have been almost entirely removed. Finally, new tarmac has given the track improved drainage and more grip.

The sad thing is that, having got so much right for 2016, SIC completely failed to promote the race domestically. Race fans complained they they knew nothing about the improvements until they saw them on the race-weekend talking heads half-hour before, first, qualifying and the race started. It was too late to decide to go to the circuit by then. Yet there were TV adverts for Singapore running on Malaysian TV months before the event, with details of the (very extensive) entertainment. there have been TV adverts for Macau's city races running on Malaysian TV more than a month before the Macau event.

Oddly, it is and always has been difficult to buy tickets for the Malaysian Grand Prix, both locally and from overseas (the same is true for all SIC events). The website is very uninformative about the event, etc.

It is ironic that Malaysia, having been the trailblazer, is now coming late to the party. There are things that can be done, at low cost, to bring it back to popularity. The reality is simple: Singapore is a great party with superb city facilities and the race is great on TV. However, it is a rubbish race to attend live because visibility is so limited. Also, there is far too much walking within the circuit, too many underpasses and bridges which require fans to ascend and descent hundreds of steps during each visit. So, as a RACE event, Singapore is actually one to miss.

Sepang offers superb views of large parts of the track, even from the "hillside" seats where people pay a few dollars to sit on the grass to watch. It is one of the few circuits on the whole global calendar where you can enjoy the race as much as you can enjoy it on TV (although they do need to work on the placement of some advertising banners which obscure views). The circuit facilities themselves have been improved and no longer look as if they are not maintained. There is not much walking and what there is is, mainly, on the flat except to climb to one's seat. As a RACE event, Malaysia beats Singapore on every level, hands down.

For entertainment, Malaysia needs to find out what its international audiences want. Here's an irony: much of the card in SIN has been booked for KL at some point (not always for the F1 gigs) in recent years and several have found it difficult to negotiate contracts or have run out of time. F1, this year, brought in about 350,000 tourists for Singapore and that far exceeds the number of tickets sold. It has, reports say, generated more than SGD150 million in "average incremental" tourist receipts over GP weekends since 2008. That does not take account of the halo effect that is generated by the popularity of the event amongst F1's leading lights who talk-up the event at every chance and the huge profile Singapore has been able to capitalise upon.

Here's another lesson for KL: Singapore actually has too much high-level entertainment. It is impossible to see it all and still be in your seat for qualifying and the race and, also, there is non-stop second-level entertainment which is good but not essential. Of course, SIN does that, in part, because it has a pretty empty race card except for F1. Sepang could have more racing over the weekend. It is almost as if SIN has become a music festival with a car race running around the perimeter.

It would be a mistake to cancel Malaysia's F1: improved, inexpensive city/circuit travel (perhaps a railway spur from the airport service would help: there is a line only a couple of kilometres away), splitting the entertainment (Saturday at the track for e.g, the "clubbing" party with DJs and Sunday in the City with a mix of high-level rock and, even, a classical concert at the amazing Philharmonic Hall), widening the entertainment scope (a good start was made on that this year), making sure that artists are booked and confirmed (including irrevocable permits) at least five or six months ahead, dramatically improving the quality of food and access to drinks (with the creation of bars and restaurants within the circuit) at reasonable prices, and far, far better marketing both locally and internationally. Malaysia Airlines should take part in a package tour promotion, with hotels that offer shuttle services to the event. These should be marketed at least six months before the event. Link the event with, for example, KL Food Week, between the Singapore race and the KL race, to encourage people to move up country. Offer special island and beach packages to those who produce their SIN and KL race tickets.

The Malaysian Grand Prix is an opportunity to expand the market to cover countries to the north. It just needs political will, less political intervention, and remarkably little additional government money.

Do that instead of abandoning something good, like happened in Kuala Lumpur city which, having set up city centre racing and providing an absolutely superb Singapore-style experience for close to no cost for spectators (and an absolutely dismal entertainment programme that no one moaned about because the racing was, essentially, free and there were two very full days of racing) somehow managed to stuff up the best thing that has happened to the city in a decade.

The Malaysian Grand Prix is not like the races in India and South Korea or even Turkey where errors in judgement at the planning stage and in basic infrastructure errors created projects that were doomed from the outset. My GP (as it is sometimes locally termed) is a star that is not burned out but could be if it's not properly cared for. To walk away from it now is to admit failure where success is so close.

Losing F1 would put Malaysia on a par with Thailand and Indonesia for motorsport, a tragedy for what was, originally, set to be not only a regional but even a world leader. For a country which is so welcoming and so creative, to shut down a flagship project because of previous bad luck and under-management is a huge mistake.

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